Millionaire population seeing significant surge: identified factors contributing to growth
In 2021, the number of ** individuals boasting a minimum income of one million euros** saw a jaw-dropping 18% surge compared to the previous year. That's right, folks, we're talking about a whopping 5,200 new millionaires! According to the smart cookies over at the Federal Statistical Office in Wiesbaden, there were approximately 34,500 of these income millionaires in 2021.
Now, what caused this boom? Part of the explanation lies in higher inflation rates, but let's not forget about the pandemic-related special effects that played a part too. Researchers are still crunching the numbers, but it seems the data is based on figures from the 2021 income and corporation tax statistics, which, as you might guess, take about three and a half years to become available post-tax year.
Adjusted for inflation, this number jumped by 12% in 2021 compared to the previous year, making it a significantly higher increase than the average inflation-adjusted growth of 6% between 2010 and 2021. "Pandemic-related special effects can help explain 2021," the statistics office casualty stated.
Moving on, you might be wondering about the income of these millionaires. Well, in 2021, their average income was a cool 2.8 million euros, a 200,000 euro increase from 2020. Sixty percent of these income millionaires made their dough through running a business operation as their primary source of income, while 19% drew their income from predominantly non-self-employed work, and 15% were self-employed.
Now, while this increase in income millionaires might be music to some ears, Bettina Kohlrausch, the scientific director of the Institute for Economic and Social Research at the Hans Böckler Foundation, doesn't see it that way. She points out that this growth contrasts with an increase in poverty. The numbers reveal that the growing concern among many people, particularly those with smaller and medium incomes, about social inequality in Germany has been validated. "The widespread feeling of great social inequality is fueling those who question the democratic order in principle," Kohlrausch added.
In summary, while the reasons behind this increase in income millionaires may be complex and multifaceted, it's clear that it's contrasted by an increase in poverty, fueling concerns about social inequality in Germany.
Economic and social policy discussions are inevitable given the surge in new millionaires in 2021, as 5,200 additional individuals boasted a minimum income of one million euros. A significant majority of these income millionaires, about 60%, gained their wealth through running a business operation as their primary source of finance.